What Can a Creditor do When a Debtor Doesn’t Pay?

Are you looking for advice on what to do when a debtor doesn’t pay? As a creditor, it is entirely your prerogative to do as much or as little as you want when you have not been paid.

At one end of the spectrum there are creditors who do nothing. Some creditors mistakenly (albeit, innocently) believe that pursuing a debtor will incur a lot of time and costs on what they perceive to already be a loss. Sadly, this way of thinking is all-too-often the norm and some savvy debtors know that by simply ignoring a creditor, there is at least some chance that they will not be pursued.

At the opposite end there are creditors who will pursue every option available to them – even when if the costs of doing so are not proportional to the debt – to hold the debtor to account.

Whilst there is no wrong or right things to do when a debtor doesn’t pay, if you’re looking for a starting point that doesn’t cost much and won’t take up more than a couple of minutes of your time, we suggest our initial Late Payment Demand (LPD). For just £2.50, we will write to the debtor demanding payment of the outstanding balance. Often, this initial solicitors’ letter is all that is needed to bring about payment.

If payment isn’t received following our LPD, then the next step would be to send a Letter Before Action (LBA). This is a formal letter required before you can issue court proceedings. Our prices for an LBA remain low at just £12.50 and most importantly, as with the LPD we do not charge any commission or recovery fee – meaning that you keep absolutely every penny recovered.

The majority of debtors (around 9/10) will pay following an LBA. For those who don’t, then the next step would be to issue court proceedings for the unpaid money and secure a County Court Judgment (CCJ) against the debtor. For all uncontested small claims matters (less than £10,000) we only charge you the fixed costs that are recoverable from the debtor, meaning that once you have been paid, your costs are also paid.

For the debtors who need a bit more of a push, we will request that a CCJ is entered and registered against them. All your costs for securing a CCJ and enforcement via the Court Bailiff or High Court Enforcement Officer are recoverable from the debtor, ensuring that debt collection through the legal process remains cost neutral for you. With low cost and quick-to-instruct actions available, Debt-Claims Solicitors makes chasing debtors quick and cost effective

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